Money Transfer Service Scheme (MTSS) is a fast and easy way to transfer personal remittances from abroad to beneficiaries in India. Under the scheme, a tie-up between reputed money transfer companies abroad called Overseas Principals and agents in India, known as Indian Agents, takes place. The funds will be disbursed by the agents to beneficiaries in India at ongoing exchange rates. Under the scheme, a cap of $2,500 has been placed on individual remittances. Also, 30 remittances can be received by a single individual beneficiary under the scheme in a calendar year.
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Only inward personal remittances are permissible in India, like remittances towards the maintenance of family and remittances favouring foreign tourists visiting India. Outward remittances from India are not permissible under MTSS.
According to India Post, remittances are growing and they are an important area for the organisation. Various remittance services are offered by the India Post to meet the demands of various sections of the society. Under MTSS, amounts up to Rs 50,000 can be paid via cash to a beneficiary in India. If the amount exceeds this limit, then it shall be paid through account payee cheque/payment order/demand draft, etc., or credited directly to the bank account of the beneficiary.
Who is an Overseas Principal?
The Overseas Principal has to be a registered entity, and licenced for carrying money transfer activities by the central bank / government or financial regulatory authority of the nation concerned. The Overseas Principal’s country of registration should be AML compliant, according to the Reserve Bank of India. Necessary authorisation should be obtained by the Overseas Principal from the Department of Payment and Settlement Systems, RBI under the provisions of the Payment and Settlement Systems Act (PSS Act), 2007 to start or operate a payment system.
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Who is an Indian agent?
In order to become an Indian agent, the applicant is required to be an Authorised Dealer Category-I bank, an Authorised Dealer Category-II, a Full Fledged Money Changer (FFMC), or the Department of Posts. Also, the Indian agents can appoint sub-agents which can be commercial entities with a place of business or retail outlets, and whose bonafides are acceptable to the Indian Agent.
